It seems Nortel (Quote) CEO Bill Owens has been logging more miles and brokered
more deals than Secretary of State Colin Powell lately.
Last week, he hammered out
details of a joint venture to build telecom equipment with China Putian.
Today, he announced a similar deal with South Korea's LG Electronics.
"To be a global communications provider, it is imperative for us to expand
our market share and compete in Asia," Owens said in a statement.
"Establishing a relationship with a world-class company is an important
step."
The joint venture, which will be equally owned, will build hardware and
software for South Korean carriers, as well as other Asia-Pacific countries.
Final terms of the joint venture are expected to be finalized during the
second quarter.
The country is a burgeoning market, especially for third-generation (define)
wireless equipment. Nortel will also sell its optical, wireless and
wireline products to enterprise customers through the joint venture.
Although not as well known as some other electronics companies, LG is no
newcomer. It was founded in 1958 and has 64,000 employees in 73 overseas
subsidiaries. Besides mobile telecom, Nortel also manufactures digital displays and media and
digital appliances. It enjoys annual revenues of nearly $30 billion a year.
In recent weeks, it has made a splash with its mobile phones. Verizon
Wireless recently tapped LG as one of the first handset vendors for its new 3G service.
North American equipment makers have been mindful of the threat coming from
Asia.
Speaking with reporters in September, Owens said he
believed Nortel has an R&D edge over most overseas producers. However, during the same interview, he said Nortel is exploring options with large
players in the Asian market.
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